HMO mortgage calculator
An HMO is priced room by room, and so is its mortgage. Enter the rooms, the rent per room and an honest occupancy assumption — see the income the stress test actually sees, the borrowing it supports across the standard rule-sets, and the deposit at 75% loan-to-value.
The HMO
Pre-filled with a worked example — type over it. Nothing you enter leaves your browser.
The income the test sees
Indicative arithmetic — not a lending decision. Many HMO lenders apply a higher ICR than the standard bands shown below.
5 rooms × £600 at 90% occupancy
Gross yield at full occupancy: 9.00% — the multiple that makes HMOs worth the extra management.
Every standard rule-set, side by side
Rows outside your selected band are dimmed for comparison. ICRs, stress floors and LTV ceilings vary by lender — these are the standard shapes, and additional-rate borrowers, HMOs and multi-unit properties are often tested harder still.
| Rule-set | Rent tested at | Indicative max loan | Limited by | Deposit needed | Monthly payment |
|---|---|---|---|---|---|
5-year fixYour band Limited company / basic-rate | 125% × 4.50% | £300,000 | 75% LTV ceiling | £100,000 | £1,125 |
5-year fix Higher-rate taxpayer | 145% × 4.50% | £300,000 | 75% LTV ceiling | £100,000 | £1,125 |
2-year fix / trackerYour band Limited company / basic-rate | 125% × 6.50% | £300,000 | 75% LTV ceiling | £100,000 | £1,125 |
2-year fix / tracker Higher-rate taxpayer | 145% × 6.50% | £300,000 | 75% LTV ceiling | £100,000 | £1,125 |
Interest-only payments at your pay rate. The stressed rate is the higher notional rate the rent is tested against, not what you pay. Some lenders apply their own minimum stress rate even on 5-year products. HMO-specialist lenders commonly test at higher ICRs (or on a commercial-valuation basis) than these standard bands — treat the table as the optimistic end.
What makes HMO lending different
The maths is the same rent-driven ICR test as any buy-to-let — but everything feeding it is different. The income is a stack of room rents with realistic voids rather than one tenancy. The lender panel is narrower and more specialist. The valuation can be bricks-and-mortar or investment-basis, which changes the loan-to-value arithmetic entirely. And many HMO lenders stress at higher coverage ratios than the standard 125%/145% bands — the table above is deliberately the optimistic end, not a quote.
What it doesn't do
- It doesn't know your council. Licensing (mandatory, additional, selective) and Article 4 planning restrictions are local-authority questions that change an HMO's viability before any mortgage maths starts.
- It doesn't model HMO-specific ICRs or investment-basis valuations — both are lender-by-lender, and both are placement questions for a specialist broker.
- It ignores the running-cost reality of HMOs — bills inclusive rents, higher management and maintenance — which belong in the rental yield calculator's net figure.
- It is arithmetic, not advice or a lending decision.
Comparing against a single-let? The buy-to-let mortgage calculator runs the same rule-sets on a single tenancy — the spread between the two answers is the HMO premium, quantified.
Common questions
- How much can I borrow on an HMO mortgage?
- The same rent-driven test as any buy-to-let, run on the room income: annual rent ÷ (interest coverage ratio × stressed rate), capped at the lender's loan-to-value ceiling. Five rooms at £600 a month with a 90% occupancy assumption is £2,700 of monthly rent — at 125% coverage and a 5.5% stressed rate (common criteria as at August 2026) that supports roughly £471,000, before the 75% LTV cap. Many HMO specialists test at higher ICRs than the standard bands, so treat the standard table as the optimistic end.
- What counts as an HMO?
- Broadly, a property let to three or more tenants forming more than one household who share facilities such as a kitchen or bathroom. Five or more tenants from more than one household usually makes it a 'large HMO', which needs a mandatory licence in England. The detail — including additional and selective licensing — varies by council, so check the local authority for the property's actual address.
- Why do HMO mortgages have different criteria?
- Because the asset runs differently: multiple tenancies, higher management load, more wear, planning restrictions in some areas (Article 4 directions), and a valuation question — some lenders value an HMO as bricks and mortar, others on an investment basis reflecting the income. That shows up as fewer lenders, slightly higher rates, and often a tougher stress test than a vanilla single-let.
- Do I need experience to get an HMO mortgage?
- Many lenders want a year or more of landlord experience before they'll lend on an HMO, and some want HMO-specific experience for larger properties. First-time landlords aren't shut out entirely, but the lender panel narrows sharply — which is exactly the kind of placement question a specialist broker deals with daily.
- Can a limited company buy an HMO?
- Yes — limited-company ownership is common for HMOs, for the same Section 24 interest-relief reasons as any leveraged buy-to-let, and company applications are typically stress-tested at 125% coverage rather than the 145% applied to higher-rate individuals. Whether the structure suits you is a tax question — take regulated advice before organising a purchase around it.
Room-level income deserves portfolio-level records.
Inside Primehold an HMO sits alongside the rest of the book — value, loan, rate and rent with the full dated history, and a lender-ready export for the next remortgage. Built by Scott West, a practising specialist mortgage broker.